How Are Lenders Viewing Bridge Loans in 2025?

[Kelly Schroeder]

Bridge financing seems to be showing up more in conversations lately, especially for investors juggling multiple projects or waiting on long-term financing to finalize.

For the lenders in this community:
- Are you seeing more demand for bridge loans compared to a few years ago?
- What criteria are you prioritizing most when approving them today (borrower track record, collateral, exit strategy)?
- Have terms shifted given the interest rate environment?

It’d be valuable to hear from both lenders and borrowers about how bridge loans are fitting into deals in today’s market.

[Doug Smith]

The term "bridge" is pretty broad. There aren't many options for some commercial categories. We're doing one right now for close to $10 million on a hotel construction deal and we'll use an SBA 504 or CMBS deal to take it out when it's complete and stabilized. Those are a bit different from the bridge loans that we do for small builders and investors to do ground-up spec construction or for flips. I am seeing the rates come down a bit on the latter residential class. There are fewer funders for the larger commercial projects. I would love to find more capital for that class as much of our referral base consist of my old banking buddies from when I was a commercial banker. I think demand in commercial is the same, but I've seen a softening in the residential construction/flip areas. We prioritize 1) experience and 2) exit strategy, & 3) liquidity of the operator. I want to know "what happens if" because as any good operator will tell you, "Snit happens". That's my 3 cents.